The government has set new principles for data centre development in recognition of the "significant capacity constraints" such facilities place on the national grid and the state's environmental obligations.

Data centre developments not in line with revised principles, published on Wednesday, would not be in line with government policy, and the Department of Enterprise, Trade and Employment said the revisions fulfil commitments under the Climate Action Plan and the National Energy Security Framework.

EirGrid said in May that the 12 biggest data centres in Ireland use more than 900MW of energy through the national grid, and the CSO revealed last year that data centres consume more electricity than all rural homes.

The government agreed on six principles including a preference for data centre developments "associated with strong economic activity and employment," indicating support for tech multinationals such as Google and Facebook who are keen to continuing developing data centres in Ireland to meet their energy requirements.

The government would prefer for data centres to make efficient use of the electricity grid, using available capacity and alleviating constrains, with data centres now responsible for 14% of electricity used in Ireland.

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Ministers also stated a preference for data centres that can add to use of renewable energy, for developments in locations with potential for renewable generation and advanced storage facilities, that can demonstrate "a clear pathway" to decarbonise and ultimately provide services on a net-zero basis, and that can provide opportunities for community engagement and SMEs.

A report conducted by energy and utilities consultancy Baringa, commissioned by Cloud Infrastructure Ireland (CII), the Ibec subgroup for cloud service providers, said data centres are "essential for modern society" and can help support Ireland's green energy transition.

The report said data centres use 80% less energy per computing load than traditional on-premises servers, reducing emissions from computing, while reducing the need for travel and physical goods.

It also said that data centres attract over €1bn per year in direct investment to Ireland and form a key part of Ireland's computer services sector, which accounted for a third of Irish exports and supported 90,000 jobs in 2020.

"This report reveals how hyper-scale data centres are vital cogs in the Irish economy and can play a positive and long-term role in helping the country progress its sustainability goals," said Dr Mark Turner, partner with Baringa.

“The report contains clear recommendations for policymakers that could, if implemented, unlock additional investment in Ireland’s digital infrastructure and help develop a more robust and sustainable domestic power system.

"Their implementation would also generate a number of other benefits, including boosting the economy, strengthening Ireland’s digital leadership, and facilitating its energy transition.” 

Michael McCarthy, director of CII, conceded growth in the data centre sector had "brought challenges" but that many decarbonisation solutions depend on data centres and rapid digitalisation could deliver half of Ireland's planned emissions reductions by 2030.

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